INTERPRETATION OF THE CIF TRADE TERM REGULATING TRANSFER OF RISK IN THE INTERNATIONAL SALE CONTRACT

The practice shows, that even in contracts, which are drawn up very carefully, the parties often omit some details concerning their rights and obligations. Trade terms are used by the parties in their contracts without any reference to the standard informing of the meaning attributed to the terms in trade relations. It is being proved in the article, that in such situations there are many ways of applying the standard worked out by the International Chamber of Commerce. It has been even proved in the literature concerning contract of international sale of goods subjected to CISG (UN Convention on the International Sale of Goods), that the possibility of excluding the interpretation of a trade terms in accordance with Incoterms (International Commercial Terms) is very limited. This possibility exists, when the parties have agreed to different interpretation of the trade terms or when the other party have known or must have known (it was impossible not to know) about different interpretation applied in the commercial circles of the contracting party (art. 8 item 1 CISG). Application of Incoterms is also excluded, when the parties have agreed to a jurisdiction clause (and simultaneously impliedly have chosen the applicable law) or when interpretation in accordance with the national laws of the parties have led to the same result (on the base of art. 8 item 2 CISG). As there are many possibilities to apply Incoterms, it is advisable - when the parties intend to interpret a trade terms in accordance with national (regional or local) custom or practice - to state it clearly in the contract. CISG acknowledges the will of the parties as the basic source of formation of international sale contract. An agreement on a trade terms CIF, regulating in details matters connected with delivery of goods, causes impliedly exclusion of application of some provisions of CISG. Within the scope of regulation concerning bearing risk of loss or damage to goods it refers in particular to provisions deciding on the moment of passing of risk to a buyer. However the mutual relation between Incoterms and CISG is much more complicated. Settlement of the questions not mentioned in Incoterms (e.g. the question of a contract's infringement's influence on bearing of risk or allocation of risk in contract on sale of goods during transit in case of bad faith of a seller) requires reference to CISG, whereas discussion on questions disputable in the light of CISG's provisions (e.g. risk in reference to extraordinary transport costs or the scope of requirement of a good's identification) should take into consideration solutions adopted in Incoterms. Irrespective of qualifing Incoterms in categories of custom or not, it is undisputed, that they still are closely connected with the practice of international trade